British army agent handlers "deliberately" helped loyalist gunmen select their targets in Northern Ireland in the 1980s, a damning official report has revealed.

But ministers may have been unaware that the lawyer Patrick Finucane was being lined up for assassination, the inquiry by Sir Desmond de Silva QC found.

The legal supervision of agents in paramilitary gangs was nonetheless woefully inadequate and the high level ignorance was possibly intentional, his report says.

The prime minister, David Cameron, told the House of Commons that the murder was "an appalling crime" and said the degree of collusion exposed was unacceptable.

And he said, in a message to the family: "I am deeply sorry."

Cameron said the Finucane family had suffered "the most grievous wrongs" and he respected their view that the De Silva review was not the right response. But he said he disagreed with them, and said a public inquiry might not have uncovered as much information about the killing.

In his report, De Silva says: "There was a wilful and abject failure by successive governments to provide the clear policy and legal framework necessary for agent-handling operations to take place effectively within the law.

"The system appears to have facilitated political deniability in relation to such operations, rather than creating mechanisms for an appropriate level of political oversight."

The murder of Finucane in front of his family at his home in west Belfast on a Sunday evening in February 1989 has proved to be one of the most divisive killings of the province's 30-year-long Troubles.

Those who directed and took part in the attack were mainly agents and informers working for the army's Force Research Unit (FRU).

De Silva's report shows that the Royal Ulster Constabulary was aware of two previous plans to kill Finucane earlier in the 1980s but did not notify him of the threat.

"Notwithstanding the apparent seriousness of the threat to Finucane's life," the report says, "the decision was taken by RUC Special Branch, supported by the Irish Joint Section (of MI5 and MI6), to take no action to warn or otherwise protect him because to do so could compromise an agent from whom the intelligence derived."

It adds, in reference to another solicitor suspected of having links to paramilitaries: "Steps were often not taken to secure the protection of those who were considered to be a thorn in the side of the security forces during this period of the Troubles."

De Silva's report covers ground that has been repeatedly trawled over by previous police investigations and inquiries. The British government has admitted there was collusion between elements of the security forces and loyalist paramilitaries.

His conclusions about the Finucane murder are broadly in line with previous reviews but are expressed in even more forceful tones.

"I was particularly concerned," De Silva says, "by the fact that, on occasions, FRU handlers [of the loyalist agent Brian Nelson] provided him with information that was subsequently used for targeting purposes. These actions are, in my view, indicative of handlers in some instances deliberately facilitating Nelson's targeting of Provisional IRA members."

But he exonerates ministers from participation in the Finucane killing. "I have found no evidence whatsoever to suggest that any government minister had foreknowledge of Patrick Finucane's murder nor that they were subsequently informed of any intelligence that any agency of the state had received about the threats to his life."

The annex to De Silva's report also breaks new ground in publishing internal MI5 documents on the Finucane case.

Andrew Sparrow's rolling coverage of the day's political developments as they happen, including David Cameron and Ed Miliband at PMQs and Cameron's statement on the report into the killing of Pat Finucane